-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Obu5jhHObuE92CZa15ewU6mL3dF+ID+Vz5692yIO/BCSUOftJzEYBV33IEWiqA5r e8kxlzrdl/JicObuXGv91A== 0000012779-97-000031.txt : 19971117 0000012779-97-000031.hdr.sgml : 19971117 ACCESSION NUMBER: 0000012779-97-000031 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970930 FILED AS OF DATE: 19971114 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: BLUE RIDGE REAL ESTATE CO CENTRAL INDEX KEY: 0000012779 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MISCELLANEOUS AMUSEMENT & RECREATION [7990] IRS NUMBER: 240854342 STATE OF INCORPORATION: PA FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-02844 FILM NUMBER: 97721023 BUSINESS ADDRESS: STREET 1: PO BOX 707 CITY: BLAKESLEE STATE: PA ZIP: 18610 BUSINESS PHONE: 7174438433 MAIL ADDRESS: STREET 1: PO BOX 707 CITY: BLAKESLEE STATE: PA ZIP: 18610 10-Q 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 1997 ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from.......... to.......... Blue Ridge 0-28-44 Commission File No.: Big Boulder 0-28-43 BLUE RIDGE REAL ESTATE COMPANY BIG BOULDER CORPORATION State or other jurisdiction of incorporation or organization: Pennsylvania 24-0854342 (Blue Ridge) I.R.S. Employer Identification Number: 24-0822326 (Big Boulder) Address of principal executive office: Blakeslee,Pennsylvania Zip Code: 18610 Registrant's telephone number, including area code: (717)-443-8433 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities and Exchange Act of 1934 during the preceding 12 months (or for such period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. YES___X____ NO__________ Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the close of the period of this report: Class Outstanding at September 30, 1997 Common Stock, without par value, 1,992,014 stated value $.30 per combined share* *Under a Security Combination Agreement between Blue Ridge Real Estate Company ("Blue Ridge") and Big Boulder Corporation ("Big Boulder") (referred to as the "Corporations") and under the by-laws of the Corporations, shares of the Corporations are combined in unit certificates, each certificate representing the same number of shares of each of the Corporations. Shares of each Corporation may be transferred only together with an equal number of shares of the other Corporation. For this reason, a combined Blue Ridge/Big Boulder Form 10-Q is being filed. Except as otherwise indicated, all information applies to both Corporations. INDEX Page No. PART I - FINANCIAL INFORMATION Item 1-Financial Statements Combined Condensed Balance Sheets September 30, 1997 and March 31, 1997 1 & 2 Combined Condensed Statements of Operations - Three Months and Six Months ended September 30, 1997 and August 31, 1996 3 Combined Condensed Statements of Cash Flows - Six Months Ended September 30, 1997 and August 31, 1996 4 Notes to Financial Statements 5 Item 2-Management's Discussion and Analysis of Financial Condition and Results of Operations 6 & 7 PART II - OTHER INFORMATION 7 Signatures 8 BLUE RIDGE REAL ESTATE COMPANY and SUBSIDIARIES COMBINED CONDENSED BALANCE SHEETS (UNAUDITED) [CAPTION] ASSETS September 30, March 31, 1997 1997 Current Assets Cash (including interest bearing deposits of $5,284 at September 30, 1997 and $2,084,101 at March 31, 1997 $ 5,284 $2,387,197 Accounts receivable 156,206 430,628 Refundable income taxes 0 23,146 Inventories 299,332 249,590 Prepaid expenses, principally insurance and real estate taxes 532,999 623,561 Deferred operating costs-net of deferred revenue-ski facilities 2,342,659 - Total current assets 3,336,480 3,714,122 Other non-current assets 36,797 36,797 Properties: Land, principally unimproved 1,867,766 1,867,766 Land improvements, buildings and equipment 47,987,227 47,146,625 49,854,993 49,014,391 Less accumulated depreciation and amortization 29,340,660 28,962,573 20,514,333 20,051,818 $23,887,610 $23,802,737 See accompanying notes to unaudited financial statements.
LIABILITIES AND SHAREHOLDERS' EQUITY September 30, March 31, 1997 1997 Current Liabilities: Notes Payable-Line of Credit $ 700,000 $ - Current installments of long-term debt 427,949 532,513 Accounts and other payables 643,726 430,814 Accrued claims 112,570 158,905 Deferred revenue 210,706 192,556 Accrued income taxes 23,626 138,566 Accrued liabilities 369,427 801,849 Total current liabilities 2,488,004 2,255,203 Long-term debt, less current installments 9,158,085 9,245,918 Deferred income taxes 2,209,711 2,201,348 Commitments and Contingencies Combined shareholders' equity: Capital Stock, without par value, stated value $.30 per combined share, Blue Ridge and Big Boulder each have authorized 3,000,000 shares and each have issued 2,198,148 shares as of September 30, 1997 and as of March 31, 1997 659,444 659,444 Capital in excess of stated value 1,461,748 1,461,748 Earnings retained in the business 9,247,854 9,235,309 11,369,046 11,356,501 LESS: Cost of 206,134 & 194,134 shares of capital stock in treasury as of September 30, 1997 and March 31, 1997, respectively. 1,337,236 1,256,233 10,031,810 10,100,268 $23,887,610 $23,802,737 See accompanying notes to unaudited financial statements.
BLUE RIDGE REAL ESTATE COMPANY and SUBSIDIARIES BIG BOULDER CORPORATION and SUBSIDIARIES COMBINED CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED) [CAPTION] Three Months Ended Six Months Ended September 30, August 31, September 30, August 31, 1997 1996 1997 1996 Revenues: Ski operations $ - $ - $ - $1,638,413 Real estate management 1,807,326 1,694,070 2,819,765 2,227,772 Rental income 363,800 490,550 853,593 1,070,256 2,171,126 2,184,620 3,673,358 4,936,441 Costs and expenses: Ski operations - - - 1,757,012 Real estate management 1,378,976 1,418,911 2,371,620 2,232,591 Rental operations 136,944 228,714 378,738 456,917 General & administra- tive expenses 253,454 232,611 523,391 443,070 1,769,374 1,880,236 3,273,749 4,889,590 Income from operations 401,752 304,384 399,609 46,851 Other income (expense:) Interest & other income 12,066 21,165 31,944 52,124 Interest expense (173,552) (209,456) (410,645) (419,499) (161,486) (188,291) (378,701) (367,375) Income (Loss) before income taxes 240,266 116,093 20,908 (320,524) Provision (Benefit) for income taxes 96,106 44,100 8,363 (279,045) Net Income (Loss) $ 144,160 $ 71,993 $ 12,545 $ (41,479) Average Common Shares Outstanding 1,992,014 2,004,014 1,995,073 2,004,014 Net Income (loss) per shares outstanding $ .07 $ .04 $ .01 $(.02)
BLUE RIDGE REAL ESTATE COMPANY BIG BOULDER CORPORATION and SUBSIDIARIES COMBINED CONDENSED STATEMENT OF CASH FLOWS FOR SIX MONTHS ENDED SEPTEMBER 30, 1997 AND AUGUST 31, 1996 (UNAUDITED)
1997 1996 Cash Flows from Operating Activities: Net income (loss) $ 12,545 $(129,679) Adjustments to reconcile net income (loss)to net cash used in operating activities: Depreciation and amortization 378,087 678,515 Deferred income taxes 8,363 (267,306) Write-off of project development costs - 178,818 Deferred revenue 18,150 (345,298) Changes in assets and liabilities: Accounts & other receivables 274,422 598 Refundable income taxes 23,146 10,000 Prepaid expenses and other current assets (2,301,839) (1,177,602) Accounts payable & accrued liabilities (265,845) (703,312) Accrued income taxes (114,940) 89,824 Net cash used in operating activities $(1,967,911) $(1,665,442) Cash Flows (used in) from Investing Activities: Marketable securities - (293,588) Collection of mortgage receivables - 3,980 Additions to intangible assets (101,631) - Additions to properties (738,971) (1,085,424) Net cash used in investing activities $(840,602) $(1,375,032) Cash flows (used in) from Financing Activities: Purchase of treasury stock (81,003) - Proceeds from notes payable, bank 700,000 363,946 Payment of long-term debt (192,397) (344,606) Net cash used in financing activities $ 426,600 $ 19,340 Net (decrease) in cash and cash equivalents $(2,381,913) $(3,021,134) Cash and cash equivalents beginning of period $2,387,197 $3,528,091 Cash and cash equivalents end of period $ 5,284 $ 506,957 Supplemental disclosures of cash flow information: Cash paid during period: Interest $ 407,377 $ 416,675 Income taxes, net $ 90,684 $ 92,859 See accompanying notes to unaudited financial statements.
NOTES TO UNAUDITED FINANCIAL STATEMENTS The combined financial statements include the accounts of Blue Ridge Real Estate Company and its wholly-owned subsidiaries (Northeast Land Company, Jack Frost Mountain Company and BRRE Holdings, Inc.) and Big Boulder Corporation and its wholly-owned subsidiaries (Lake Mountain Company and BBC Holdings, Inc.). In the opinion of management, the accompanying unaudited combined condensed financial statements contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly the financial position as of September 30, 1997, and the results of operations and the statements of cash flows for the six month periods ended September 30, 1997 and August 31, 1996. Due to the change in the fiscal year end the most comparable six month prior year information is the six month period ended August 31, 1996. The restatement of prior year quarters was not cost justifiable. The results of operations for the three and six months are not necessarily indicative of the results to be expected for the full year since (a) the Companies' two ski facilities operate principally during the months of December through March and (b) land dispositions occur sporadically and do not follow any pattern during the fiscal year. Costs and expenses net of revenues received in advance attributable to the ski facilities for the months of June through November are deferred and recognized as revenue and operating expenses, ratably, over the operating period. The provision (credit) for income taxes for the six months ended September 30, 1997 and August 31, 1996 represents the allocation of the estimated annual effective tax rate for the year ending March 31, 1998 and 1997, respectively. In September 1997, the loan on the Dreshertown Plaza matured and was subsequently refinanced with CoreStates Bank. Earnings per share are computed by dividing net income by the weighted average number of common shares outstanding, which have only been affected by the purchase of 12,000 shares of Treasury Stock in May 1997. There are no items that have a dilutive effect on earnings per share. In February 1997, the Financial Accounting Standards Board issued Statement No. 128, "Earnings per Share," which establishes new standards for computations of earnings per share. The Statement is effective for periods ending after December 15, 1997, with prior periods restated at that time to comply with the new standards. If the Statement had been effective for the periods ended June 30, 1997 and May 31, 1996 there would have been no significant change in earnings per share as presented in the accompanying Combined Statements of Income. On July 1, 1997, the Board of Directors granted the Chairman of the Companies options to acquire 25,000 shares of the Companies Common stock. The options were issued at the fair market value on July 1 of $6.75. The options expire July 1, 2003. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Results of Operations Operations for the Second Quarter and First Half of Fiscal 1998 resulted in Net Income of $.07 and $.01 per combined share compared to a Net Income (Net loss) of $.04 and ($.02) per combined share for the six months ended August 31, 1996. Combined revenue of $3,673,358 represents a decrease of $1,263,083 for six months ending September 30, 1997, compared to the six months ended August 31, 1996 of the previous year. Ski operations decreased $1,638,413, Real Estate Management increased $591,993 and Rental Income decreased $216,663. The decrease in Ski operation revenues for the six months ended September 30, 1997 as compared to August 31, 1996 is attributed to the change in fiscal year end which results in non-conforming quarterly comparisons. The six months ended September 30, 1997, does not reflect any ski operation income whereas the six months ended August 31, 1996 does. Ski operation income is generated December through March annually. Real Estate Management increase in revenue is attributed to festival revenues, recreational activities, rental management operations and property management of homes in our resort communities. The increases were offset with a decrease in marketing fees from resale of homes in our resort communities. Rental income decrease in revenue is from investment properties. Interest and Other Income decreased $20,180. Operating costs decreased by $1,615,841 during the first six months of Fiscal 1998 as compared to the six months ended August 31, 1996. This was primarily due to the non-conforming quarterly comparison. The six months ended September 30, 1997 does not reflect any ski operation expenses whereas the six months ended August 31, 1996 does. Ski operations are encompassed December through March annually. General and Administrative expenses for the first six months of Fiscal 1998 as compared to the six months ended August 31, 1996, increased by $80,321 primarily because of supplies. Several items are non-recurring services related to expansion. Interest expense for the first six months of Fiscal 1998, as compared to the six months ended August 31, 1996, decreased by $8,854 because of the re-financing of the Dresheertown Plaza loan. The effective income tax rate for the First six months of Fiscal 1998 was 40%, as compared to 38% for the six months ended August 31, 1996. State taxes account primarily for the Fiscal 1998 and 1997 effective rates being greater than the federal statutory rate of 34%. Financial Condition, Liquidity and Capital Resources Working capital as of September 30, 1997 decreased by $610,443 as compared to March 31, 1997. This was due principally to a decrease in accounts receivable, an increase in payables and renovations to the properties. The change in the balances of accounts receivable, deferred operating costs and accrued liabilities from March 31, 1997 to September 30, 1997 was due primarily to revenue and expenses that are applicable to the ski facilities, which are deferred and recognized ratably during the months of December through March. Moving Forward Capital expenditures for the First Half of Fiscal 1998 were for various equipment purchases. The Companies, in Fiscal 1998, will expand camping sites at Fernridge Campground and continue snow tubing and snow making expansion at Big Boulder and Jack Frost. Change in Fiscal Accounting Period At the July 24, 1996, Board of Directors meetings, a change in the fiscal year end was approved from May 31 to March 31. This change will be effective for each of the Companies' 1997 Fiscal Year. The purpose is to have the fiscal reporting period coincide with the operating periods of the profit centers initiated over the last several years. PART II - OTHER INFORMATION The Companies have no matters to report with respect to Items 1, 2, 3, 4, 5, and 6(A) and (B). FORM 10-Q SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized: BLUE RIDGE REAL ESTATE COMPANY BIG BOULDER CORPORATION (Registrant) (Signature) Gary A. Smith President (Signature) Cynthia A. Barron Chief Accounting Officer Date: November 12, 1997 EX-27 2
5 6-MOS MAR-31-1998 SEP-30-1997 5,284 0 156,206 0 299,332 3,336,480 47,987,227 29,340,660 23,887,610 2,488,004 0 0 0 1,992,014 0 23,887,610 3,673,358 3,673,358 0 3,273,749 0 0 (410,645) 20,908 88,363 0 0 0 0 112,545 .01 0
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